{"id":15597,"date":"2022-02-10T02:39:19","date_gmt":"2022-02-10T02:39:19","guid":{"rendered":"https:\/\/amabhungane.org\/?post_type=stories&p=15597"},"modified":"2024-09-14T07:11:40","modified_gmt":"2024-09-14T07:11:40","slug":"220210-gold-export-scheme-the-rudland-connection","status":"publish","type":"post","link":"https:\/\/further.co.za\/amabwp\/220210-gold-export-scheme-the-rudland-connection\/","title":{"rendered":"Gold export scheme: the Rudland connection"},"content":{"rendered":"

Evidence suggests the controversial Rudland family of Zimbabwe, which has made a bid to control Tongaat Hulett, has links to Rappa, the gold refinery targeted by the South African Revenue Service (SARS) for an alleged multi-billion rand gold VAT scam as revealed by amaBhungane last week<\/a>.<\/p>\n

The evidence, while circumstantial, relates to links between Simon Rudland, his controversial Gold Leaf Tobacco Corporation (GLTC) and Howard Jon Baker, who is on paper the major shareholder of Rappa.<\/p>\n

Raees Saint, the lawyer simultaneously representing Rudland, Baker and GLTC, told amaBhungane, \u201cSimon Rudland has no interest in the Company [Rappa] and your allegations concerning the \u201cholding company\u201d that \u201ccontrols the refinery\u201d are entirely incorrect. Any publication of false and\/or malicious information in this regard will be strongly challenged.\u201d<\/p>\n

He said his clients \u201cwill not tolerate any insinuation of any illegal conduct and your reference to same will be dealt with in the appropriate Court of law\u201d.<\/p>\n

Although Saint did not explicitly confirm he also represents Rappa, the company\u2019s chief executive Gary Bickerton also referred our questions to him.<\/p>\n

See Saint\u2019s full response\u00a0here<\/a>.<\/em><\/p><\/blockquote>\n

This circumstantial link between the Rudlands and Rappa might cast new light on the ability of the largely unknown Magister Investments, registered in Mauritius and controlled by Simon\u2019s brother and long-time business partner Hamish Rudland, to put down R2-billion to buy control of Tongaat<\/a>.<\/p>\n

A lawyer representing Magister told amaBhungane, \u201cNeither Hamish Rudland nor Magister are under any obligation to disclose private company information to you, nor do we nor Hamish Rudland consent to publication by you of any private or confidential information.\u201d<\/p>\n

See Magister\u2019s full response here<\/a>.<\/em><\/p><\/blockquote>\n

Who is behind Rappa?<\/strong><\/p>\n

When a company called Rappa Management was given the green light by the Competition Tribunal to take over the Rappa gold refinery in July 2019, the identity of the beneficial owners of Rappa Management was blacked out.<\/p>\n

However the Tribunal did note that of relevance to the competition assessment of the proposed transaction were the activities of a Dubai based company, Aulion Global Trading DMCC.<\/p>\n

This was because, the Tribunal said, in South Africa, Aulion procures semi refined gold bars from (only) Rappa Resources and that Aulion \u201cforms part of the Rappa Management group of companies\u201d that was bidding to take over the South African firm.<\/p>\n

In other words, the Dubai company buying gold bars from the refinery and the new company bidding to take over the refinery in South Africa had the same owner.<\/p>\n

AmaBhungane has since established that at the time of the takeover the declared owner of both Aulion and Rappa Management \u2013 and hence the gold refinery under investigation by SARS\u00a0\u2014 was Howard \u201cHowie\u201d Baker.<\/p>\n

Who is Howard Baker?<\/strong><\/p>\n

Baker is well known in polocrosse circles having previously played for both Zimbabwe and South Africa. He is also not a new arrival in the second-hand gold industry.<\/p>\n

He has little online presence, but was a director between 2013 and 2015 of a company called \u201cthe Gold Kid Trading\u201d.<\/p>\n

Company records seen by amaBhungane show that Baker obtained a 42.5% share in the close corporation in 2013\/14 when the company did nearly a billion rands in turnover.<\/p>\n

Of interest is that Gold Kid was a significant supplier of gold to Rappa in previous years and one of its founding members, Andries Greyvenstein, was last year convicted for \u201cillegal dealing and illegal possession of unwrought precious metals\u201d, according to a media statement by the Hawks.<\/p>\n

Baker, via Aulion and Rappa, is now entangled in allegations concerning the machinery of the colossal gold-based VAT scam currently being battled by SARS behind closed doors, as detailed in an amaBhungane expos\u00e9 last week.<\/p>\n

That alleged scheme revolves around Rappa Resources, a large gold refinery that allegedly buys up tons of illicit gold laundered into the legitimate supply chain\u00a0\u2014 and then exports it to claim enormous VAT refunds.<\/p>\n

Rappa has vehemently denied the allegations, maintains SARS is on a witch-hunt and has taken on the tax authority in a series of court applications since SARS stopped paying out its VAT claims.<\/p>\n

We’re a non-profit newsroom that exposes wrongdoing, empowering people to hold power to account. But we cannot do it without <\/em>your support<\/a><\/u><\/em>.<\/em><\/p>\n

*Family interests behind prospective new owners of Tongaat Hulett appear linked to a web of companies suspected of shifting money offshore and seemingly entangled in a SARS gold scam investigation.<\/p>\n

*This raises new questions about how a R2-billion bid for the sugar giant is being funded.<\/p>\n

Baker and Rudland<\/strong>\u00a0<\/strong><\/p>\n

Three sources who asked not to be named, identified Baker as a friend of Simon Rudland and named Rudland as being a behind the scenes player in the Rappa gold business, though they did not provide any evidence of this and as noted, his lawyer has denied any such involvement.<\/p>\n

There are circumstantial links, however.<\/p>\n

Firstly, Rappa Management, the company (allegedly owned by Baker) that took over the refinery in 2019, has only one director: lawyer Raees Saint, a man inseparable from Simon Rudland\u2019s tobacco business. It was Saint who responded to our questions on behalf of both Baker and Rudland.<\/p>\n

Saint is also GLTC\u2019s attorney and spokesperson. He represented the tobacco company when it was still a member of the Freetrade Independent Tobacco Association (FITA), an industry group for smaller cigarette producers.<\/p>\n

In 2019 Rudland was shot outside the association\u2019s offices in an apparent assassination attempt.<\/p>\n

After Rudland and FITA parted ways in acrimonious fashion, Saint emerged as the chair of a new organisation, the South African Tobacco Organisation (SATO).<\/p>\n

Saint\u2019s co-directors in SATO\u00a0\u2014\u00a0<\/span>a Zimbabwean and a Malawian\u00a0\u2014 are both associated with companies that have close business ties with GLTC, suggesting that SATO is GLTC\u2019s proxy. Saint vehemently denies this.<\/p>\n

The Baker-Rudland link is further supported by another Baker company in the United Arab Emirates called Paloma Precious. Since 2018 this company employs one Craig Preston who is simultaneously an employee of Pioneer Development Company in Zimbabwe, according to his LinkedIn profile. Pioneer appears to be associated with both Simon and Hamish Rudland, and the latter previously declared his directorship of Pioneer.<\/p>\n

What\u2019s more, Preston then became a director of Rappa Holdings in February 2020.<\/p>\n

This suggests a Rudland employee is also a Baker employee and a director of the gold refinery.<\/p>\n

Which brings us back to Aulion in Dubai, the company owned by Baker.<\/p>\n

Where there is smoke\u2026<\/strong><\/p>\n

On 15 September 2017 Amanda Gie, the head of forex operations at Sasfin Bank emailed three top executives at the niche corporate financial services provider.<\/p>\n

The subject: \u201cGOLD LEAF TOBACCO CORPORATION PTY LTD\u201d. \u00a0GLTC is the controversial producer of \u201ccheapie\u201d cigarettes that is controlled Simon Rudland and his business partner Ebrahim Adamjee.<\/p>\n

\u201cBusiness is of the opinion that it would be in the best interest of Sasfin Bank to exit the relationship with the client with immediate effect as the bank faces image, financial and serious regulatory repercussions,\u201d Gie wrote to her Sasfin bosses.<\/p>\n

The deals threatening Sasfin with \u201crepercussions\u201d involved a network of companies in secrecy jurisdictions like Dubai and Mauritius that billed GLTC in South Africa millions of rands for tobacco, cigarette-making machinery and related materials.<\/p>\n

Gie\u2019s concern was that some suppliers looked to Gie like \u201cinvoice factories\u201d which generate paperwork showing apparently legitimate transactions to throw banks and regulators off the scent when large amounts of money leave the country.<\/p>\n

If true, the purpose of such a scheme would be for GLTC to get money out of South Africa under false pretences.<\/p>\n

Among the suppliers Gie flagged one name however stood out: Aulion Global Trading, Baker\u2019s Dubai gold trader, which appears to have issued two invoices to GLTC worth nearly R400-million.<\/p>\n

In other words, Baker was suspected by Sasfin of helping Rudland\u2019s company externalise funds.<\/p>\n

Meanwhile in Windhoek\u2026<\/strong><\/p>\n

In 2017 Namibia experienced a bank collapse similar to what happened to VBS Mutual Bank in South Africa. The destruction of the Small and Medium Enterprises Bank (SME) even involved characters from the VBS saga as we reported here<\/a>.<\/p>\n

Shareholders and executives stole at least R380-million from the tiny lender before the central bank seized control and SME eventually went into liquidation.<\/p>\n

Subsequent investigations uncovered what looked like a money laundering network based in Johannesburg through which most of the money was routed.<\/p>\n

An alleged R79.8-million of this stolen money flowed into the accounts of Asset Movement and Financial Services (AMFS) in Johannesburg, a company that handled enormous amounts of money daily for a client base including several gold traders accused by SARS of participating in the VAT fraud scheme.<\/p>\n

Documents the SME liquidators have filed in the Windhoek high court show that Howard Baker on several occasions in 2016 sent AMFS emails directing them to pay millions of rands into various accounts,<\/p>\n

One of these belonged to a Omulunga Capital Investments, a registered a mere two weeks before the payments started.<\/p>\n

On 27 January it was R7.07-million, on 29 January it was R3.03-million, on 5 February it was R6.06-million and on 20 May another R10-million.<\/p>\n

The instruction by Baker gives the details of the recipient as Omulunga Capial Investments. All these payments were duly made by AMFS.<\/p>\n

Right before starting these payments to Omulunga, Aulion entered the picture.<\/p>\n

On January 21, 2016 Aulion had provided Omulunga with an invoice for R64 493 439 for payment to its Dubai bank account.<\/p>\n

The invoice was for mining equipment which suggests Aulion was now ostensibly trading in gold, tobacco and heavy machinery.<\/p>\n

Omulunga duly paid Aulion at least R29 820 000 using this invoice repeatedly for several different transactions. The payments matched the payments received from AMFS on Baker\u2019s instruction. They totalled R29,8-million. This suggests this channel could still have been used to move a further R35-million using the single Aulion invoice.<\/p>\n

Saint failed to answer specific questions about these trades or what the relationships were between Rudland, GLTC, Baker and Aulion.<\/p>\n

He said: \u201cGold Leaf Tobacco Corporation, a private company, has nothing to do with THL[Tongaat Hulett Limited] or Magister for that matter. Your line of questioning concerning alleged historical business dealings of Gold Leaf Tobacco are unmerited and unrelated to anything you purport to infer concerning the THL transaction.<\/p>\n

\u201cOur clients will not participate nor entertain your fishing expedition as all of the information you request related to private matters pertaining to different private individuals and private companies.<\/p>\n

We caution you against selective and agenda driven reporting, our clients will not tolerate any sensationalism written about them through unethical abuse of journalism.\u201d<\/p>\n

Chinese wall? Not at all<\/strong><\/p>\n

Ever since the deal that would see Hamish Rudland\u00a0\u2014 via Magister\u00a0\u2014 take control of Tongaat was announced the two companies have been at pains to distance themselves from Simon Rudland and in particular GLTC.<\/p>\n

In a response to questions earlier this year Hamish Rudland said:<\/p>\n

\u201cMagister has no involvement or interest in Gold Leaf Tobacco Corporation, nor does Gold Leaf Tobacco Corporation have anything to do with the transaction between Magister and Tongaat.\u201d<\/p>\n

There are however any number of reasons to doubt that there is really a Chinese wall separating Magister and Hamish Rudland from his brother Simon and the controversial tobacco business.<\/p>\n

While Tongaat and Hamish have presented Magister as an accomplished investment vehicle easily able to marshal the R2-billion for the deal a closer examination of the company and Hamish\u2019s other interests show how \u201cRudland Inc\u201d is very much a family business.<\/p>\n

Long before the deal was announced in December last year the Rudlands had already become the second largest single shareholder in Tongaat when a Dubai based company Braemar ostensibly controlled by the brothers\u2019 mother bought 9.981% of the company worth R120-million at the time.<\/p>\n

Leading up to the announcement in December individuals tied specifically to GLTC and the Rudlands were also buying significant numbers of shares.<\/p>\n

Simon Rudland\u2019s partner in GLTC, Ebrahim Adamjee, bought 1.5% of Tongaat\u2019s shares for roughly R10-million in December last year.<\/p>\n

A company founded by his son Aadil, Betelguex Investments, bought another 2%. This was right before Tongaat shareholders were going to vote on the Magister takeover.<\/p>\n

Aadil also served for a number of years on the board of Zimre Holdings, in which both brothers still appear to have an interest.<\/p>\n

Saint, on behalf of Adamjee, denied \u201cany insinuation of any illegal conduct\u201d.<\/p>\n

Magister by itself does not appear to a substantial investor. Its only visible investment is in a small company called Agriterra which has a total turnover (not cash or profit) of $12-million or roughly R185-million.<\/p>\n

A presentation given to major Tongaat shareholders (reported on in an earlier amaBhungane report<\/a>) in order to gain their support for the Magister deal presented Magister’s “key investments” as including Agriterra but also a number of Zimbabwean companies.<\/p>\n

As far as amaBhungane was able to establish, these have historically been owned by other Rudland family entities, rather than Magister.<\/p>\n

The most substantial of these companies are listed and have publicly available financial information.<\/p>\n

Using official exchange rates these companies\u00a0\u2014\u00a0<\/span>Zimre Holdings, CFI Holdings, Unifreight and TSL\u00a0\u2014\u00a0<\/span>have a combined balance sheet of only about R3,1-billion.<\/p>\n

Neither Magister nor the Rudlands own all the shares in these companies and they would likely have to give their entire visible Zimbabwean business empire as security to afford the offer being made for Tongaat.<\/p>\n

Unless the money comes from elsewhere.<\/p>\n","protected":false},"excerpt":{"rendered":"

Family interests behind the prospective new owners of Tongaat Hulett appear to be linked to a web of companies suspected of shifting money offshore and which are seemingly entangled in a SARS gold scam investigation. This raises new questions about how a R2-billion bid for the sugar giant is being funded. <\/p>\n","protected":false},"author":2,"featured_media":20884,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[2],"tags":[839,840,841,842,843,844,816,845,846,847,848,849,850,851,66,852,853,854,855,856],"class_list":["post-15597","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stories","tag-amanda-gie","tag-amfs","tag-asset-movement-and-financial-services","tag-aulion-global-trading","tag-gltc","tag-gold-leaf-tobacco-corporation-pty-ltd","tag-hamish-rudland","tag-howard-jon-baker","tag-magister","tag-medium-enterprises-bank-sme","tag-omulunga-capital-investments","tag-rappa-holding","tag-reetrade-independent-tobacco-association-fita","tag-rudland-inc","tag-sars","tag-sasfin-bank","tag-sato","tag-simon-rudland","tag-south-african-tobacco-organisation-sato","tag-vbs-mutual-bank"],"acf":[],"_links":{"self":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/15597","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/comments?post=15597"}],"version-history":[{"count":1,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/15597\/revisions"}],"predecessor-version":[{"id":29921,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/15597\/revisions\/29921"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/media\/20884"}],"wp:attachment":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/media?parent=15597"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/categories?post=15597"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/tags?post=15597"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}